Guest article by Nils Wolters, MIDA Frankfurt |
The ASEAN Investment Forum 2017, subtitled “Investment opportunities in the world’s most dynamic growth region”, was held on 19 June 2017 in Frankfurt Marriott Hotel. It was attended by some 180 people mostly from the German business community.
The event was the second iteration of a format that had its debut in April 2016. Back then, the investment agencies of Malaysia, Thailand and Vietnam initiated the ASEAN Investment Forum, the first of its kind, with various investment promotion agencies of ASEAN countries working together. The aim was to raise awareness on the benefits of the whole region among the German and European business community.
In 2017, the founders of the ASEAN Investment Forum had built on their experience from the previous year and expanded and restructured the ASEAN Investment Forum, resulting in an all-improved and comprehensive business seminar revolving around investments into the ASEAN region.
The second iteration was co-organised and executed by investment promotion agencies of Malaysia, the Philippines, Singapore and Thailand. Combined, these four countries are home to more than 205 million people and symbolically represent the broad social and economic diversity of the ASEAN region. The idea behind this seminar is to join the forces of the various ASEAN countries and to present their unique strengths and advantages to the German business community.
The companies that were present at the event come from many different sectors like automotive, machinery, logistics, aerospace and chemicals, to name just a few.
The event was officially opened by Dr. Jürgen Ratzinger, Director International of the Chamber of Commerce & Industry in Frankfurt. In his remarks, Dr. Ratzinger emphasised that the term “Asian Century” does not only include China anymore but also specifically ASEAN. Today, there are seven German chambers in the ASEAN region today, with almost 3,000 member companies. In 2012 they have joined forces and established the “ASEAN Chamber of Commerce & Industry” to meet the rising demands of the rapidly growing Southeast Asian region. German-ASEAN trade volume in 2016 amounted to EUR 59 billion and has been growing by 6% p.a. in the last ten years.
EU-ASEAN business ties
The first presentation of the event, held by Mr. Chris Humphrey, Executive Director of the EU-ASEAN business council, focused on the business relationship between the two European and Southeast Asian organisations. Europe remains the largest source of external FDI funds into ASEAN. In regards to trade, the EU is ASEAN’s second largest partner after China with a steady and rapid growth rate (+73% EU-ASEAN trade in goods 2005-2015). Mr. Humphrey closed his presentation with excerpts from last year’s business sentiment survey, stating that the vast majority of respondents plan to increase their operations, investments and trade in the ASEAN region in the next few years.
ASEAN as a profit centre
Dr. Sufian Jusoh from the World Trade Institute presented the ASEAN region as a profit centre for foreign companies. He pointed out the advantages and benefits of ASEAN as a single market and production base, reaching billions of people through various free trade agreements (FTAs). Dr. Sufian then went on to update the audience of the latest developments of investment policies in the various ASEAN countries such as the promotion of green technology in Malaysia or the liberalization in the banking sector in the Philippines.
Keynote by BASF
The keynote speech of the ASEAN Investment Forum 2017 was held by the President of the Regional Division South & East Asia, ASEAN and Australia/New Zealand from BASF, Dr. Andrea Frenzel. Her speech with the title “Successful strategies for doing business in ASEAN markets” was revolving around the experience of BASF in the region. The German chemical giant is active in all four partner countries of the ASEAN Investment Forum. BASF employs around 4,000 people in ASEAN, with an annual turnover of almost EUR 2 billion. Dr. Frenzel also listed the factors that will shape the chemical market in ASEAN, namely the high urbanization rates throughout the region, the young and growing demographics as well as the average economic growth rate of 5% p.a. At the end of her speech, Dr. Frenzel presented a few examples of BASF operations in ASEAN. One of these examples was their “Verbund Site” (highly integrated chemical plant where several production sites are inter-connected) in a Joint Venture with Petronas in Kuantan, Malaysia, which produces chemicals for more than 600 customers in the Asia-Pacific region.
ASEAN Investment Promotion Agencies in Germany
The first panel of the event consisted of the four regional directors of the investment promotion agencies of Malaysia, the Philippines, Singapore and Thailand in Germany. After short introductions and presentations from each country, the panelists talked about the strengths and focus areas of their countries. Additionally, they informed the audience of the specific incentives and aid that the investment agencies can provide to investors.
Practical business matters for potential investors
As the idea behind the ASEAN Investment Forum 2017 was to provide as much practical and relevant information to potential investors as possible, the organisers invited experts from the German-Philippine Chamber of Commerce and Industry, EY and Luther Services to give insights on practical matters like costs of doing business in ASEAN, taxation or how to incorporate a company in the various ASEAN countries.
German companies in ASEAN
The last panel of the event was arguably also one of the biggest highlights: four representatives of German companies that have operations in the four ASEAN countries frankly talked shared their experiences in their respective countries. The companies were Eppendorf, a lab tech manufacturer from Hamburg for Malaysia, Lufthansa InTouch, the customer service division of the German aviation company for the Philippines, MANN+HUMMEL, a filter producer for Singapore and Robert Bosch for Thailand. The topics discussed included the reasons why the companies decided for a particular ASEAN country based on their specific demands, their plans for the future, compliance in ASEAN, and more.
After two successful iterations, the ASEAN Investment Forum will become an annual event, a household name for business-related issues in the ASEAN region for the German and European community. The event is one of its kind worldwide when it comes to different ASEAN investment agencies joining forces to promote the entire ASEAN region among potential foreign investors. It will be interesting to follow the development of this annual event series in the future.